Jim Armitage: Who’s next in the software merger frenzy?
Cambridge-based Aveva’s £3 billion takeover by Schneider Electric has got investment bankers sharpening their pencils — and bonus hopes — as the big engineers look to bulk up the specialist software that runs their operations.
Top of the list has to be Aveva’s rival Bentley Systems, a privately owned outfit controlled by five brothers in the US.
Rumour has it that Hexagon — a recent consolidator itself — wouldn’t say no to suitors either —though, with a market value on the Nordic exchange of 140 billion kronor (£13 billion), it’s a big bite. Could a giant like Siemens, ABB or Honeywell be interested?
Takeovers of software groups by manufacturers aren’t always a success. Who could forget the $11.7 billion (£9 billion) buyout of Britain’s Autonomy by Hewlett Packard?
In one of the worst deals of the century, HP wrote down its value by $8.8 billion.
If Schneider isn’t aware of the pitfalls, it should be. After all, the most experienced executive on its strategy committee is one Léo Apotheker, chief executive of Hewlett Packard when it did the disastrous Autonomy deal.
Hope he’s learned a thing or two.
